First Time Homebuyer Mortgage

New to Canada? Planning to buy your first home? The goal of becoming a homeowner seems to be becoming more and more unattainable for young Canadians with the allowance of 30 years amortization period on brand new home purchases.

Over the past few years, skyrocketing housing costs and rising interest rates have resulted in serious affordability issues. The Canadian government has unveiled a new strategy aiming at bringing that goal a little closer to reality with its move of increasing five more years in mortgage amortization. If you are buying your first home and are in need of first time homebuyer mortgage in Abbotsford, rely on a seasoned mortgage broker with a proven track record of mortgage approval.

What’s The New Change?

An insured mortgage in Canada, or one with a down payment of less than 20%, could only have amortization duration of 25 years in the past. First-time homebuyers, who frequently have lesser down deposits, would therefore have to pay larger monthly mortgage payments.

The new policy, coming into effect on August 1, 2024, extends the amortization period for these buyers to 30 years on newly built homes.

More Accessibility & Lower Monthly Payments

The decrease in monthly mortgage payments is the main advantage of this new rule. The monthly payment is made more reasonable by extending the loan for an extra five years. 

For young Canadians who are dealing with affordability, this might be a game-changer. Their ability to qualify for a larger mortgage and even move into homeownership sooner is made possible by the lower payments.

Some Aspects To Consider For First Time Home Buyers

Total Interest Paid: You will pay more interest on your mortgage if you choose a longer amortization time. Thirty years may be a considerable amount of money.

Long-Term Debt: Having a mortgage for an extended length of time may limit your ability to move around financially. This is an important consideration when creating long-term financial planning.

Pay Attention to Long-Term Affordability: The monthly payment reduction shouldn’t take precedence over the house’s total cost. Make sure you can afford the house for the duration of the loan by carefully evaluating your budget.

Your Financial Situation: A 30-year mortgage can be a good choice if you have a steady income and trust your abilities to handle your money.

Interest Rates: As the interest cost decreases in importance, lengthier amortizations become more appealing.

Your Long-Term Objectives: A 25-year mortgage would be desirable if you want to sell the house quickly in order to pay it off sooner and accumulate equity more quickly.

Pave The Path To Easy Homeownership With Satbir Bhullar

It’s important to speak with a mortgage broker before making a decision. Satbir Bhullar is an experienced first home mortgage broker in Abbotsford assisting clients in weighing the advantages and disadvantages of each choice, estimating the entire cost of ownership in various situations, and making sure the mortgage is in line with your overall financial objectives.

For more details on this new 30 year amortization period policy, give us a call right away.

 

Buying a home is one of the biggest financial decisions you’ll ever take. No matter, you are a seasoned investor or a first-time home buyer, becoming a homeowner may be an exciting and daunting experience. Getting a mortgage pre-approval is an important step that gets sometimes missed in the excitement of homeownership.

A lender evaluates your financial data to ascertain the maximum amount of money you are qualified to receive for your loan during a mortgage pre-approval, which is an initial stage in the home-buying process. Providing paperwork about your earnings, assets, credit history, and obligations is required. The pre-approval letter, which indicates the maximum loan amount you can obtain, can be sent to you by the lender after they have reviewed this information.

In this blog, we’ll talk about the role a mortgage pre-approval plays in successful home purchase.

Some of the top benefits you can enjoy with mortgage pre-approval include:

  • Secures you an affordable amount to buy a house

An affordable budgeting framework is provided by a pre-approval letter, which also helps you avoid falling in love with a property that you can’t afford. This implies that you will find your dream property faster and with fewer headaches. On the other hand, you are free to submit an offer if you do find a house that fits into your price range and you like it.

  • Strengthens the value of your offer and buying interest

Obtaining a pre-approval increases your negotiating power. The seller will perceive you as having taken real measures for buying a property and having the financial stability to support your decision, rather than just looking at properties. When compared to other offers that lack pre-approvals or have lower maximum loan amounts, a one with pre-approval will appear stronger in such situations.

  • Simplifies and eases the mortgage application process

A pre-approval also facilitates an efficient mortgage application procedure by laying the framework for documentation checks you’ll need later after your offer on a property is accepted. The financial review has already been completed in large part, so the final approval procedure usually proceeds swiftly and without difficulty. Sellers will pick you over someone who hasn’t already completed the front-loading paperwork.

  • Provides information about your overall financial health

In addition to helping you buy a house, a pre-approval can help you assess your financial situation more clearly. A thorough examination of your financial history and credit score is necessary for the process. You may learn about financial concerns involved and gain a better understanding of your current situation in connection to your home buying objectives via the pre-approval process. 

So, these were some of the benefits of getting a mortgage pre-approval before starting with your home search journey. If you are looking for a reliable mortgage broker to help you with residential mortgage pre-approval in Abbotsford and Surrey, rely on none other than Satbir Bhullar.